Indian Government Extends Timeline for Solar Parks Development Program

The Ministry of New and Renewable Energy (MNRE) in India has recently announced an extension of the timeline for the 'Development of Solar Parks and Ultra Mega Solar Power Projects & program. The program, which was implemented in December 2014,aims to support the rapid installation of grid-connected solar power projects on a large scale. The extension, until March 31, 2026, comes as the development of solar power parks has been slower than anticipated, with only a fraction of the approved projects completed so far. The solar park development program faced various challenges, including land availability and acquisition. However, solar parks proved to be an attractive solution to address these issues due to limited legal complications and other variables, making them economically feasible for developers. The program requires solar parks to have a capacity of 500 MW or more, with smaller parks considered only in areas facing a shortage of non-agricultural or contiguous land. Lackluster Progress and Revised Targets: As of February 2023, only nine out of the 57 approved solar parks have been completed, with an additional eight partially set up, representing a cumulative capacity of 10,117 MW. Recognizing the slow progress, the MNRE extended the timeline to achieve the original target of setting up at least 25 solar parks and ultra mega solar power projects with a capacity of 20 GW within five years starting from FY 2014-15. Moreover, the capacity target was increased to 40 GW in March 2017, with parks proposed to be set up by FY 2023-24. Financial Implications and Eligibility: The extension of the timeline does not involve any financial implications, and the central financial assistance under the program remains unchanged. All states and Union Territories in India are eligible for benefits under the program. The solar parks are developed in collaboration with state governments, their agencies, central public sector undertakings, and private entrepreneurs. Central Financial Assistance (CFA) and Implementing Agencies: Under the program, the MNRE provides CFA to support solar park development. The assistance includes funding of up to ₹2.5 million ($30,472) per solar park for preparing a detailed project report and ₹2 million ($24,377)/MW or 30% of the project cost, including grid-connectivity cost, whichever is lower. The implementing agency, known as the Solar Power Park Developer (SPPD), can be the Solar Corporation of India (SECI), CPSUs/state PSUs/government organizations, or their subsidiaries and joint ventures. The designated nodal agency is eligible for funding for internal and external infrastructure development. Parliamentary Committees & Concerns: The slow progress in solar park development led to disappointment expressed by the Parliamentary Standing Committee on Energy in August 2022. The committee highlighted the country`s shortfall in meeting the solar park targets and urged authorities to accelerate the implementation process. Future Prospects and Initiatives: To expedite the development of solar parks, the Gujarat State Electricity Corporation recently invited bids for a feasibility report and detailed project report to establish a 1,500 MW floating solar park in the Tapi district. Such initiatives demonstrate ongoing efforts to leverage solar power and meet renewable energy targets in India. The extension of the timeline for the Development of Solar Parks and Ultra Mega Solar Power Projects; program in India provides a much-needed opportunity to address the sluggish progress in solar park development. With the continued support of the MNRE and collaboration among stakeholders, the country can further harness the potential of solar energy, drive sustainable electricity generation, and contribute to global efforts in combating climate change. - Shakti Kumar Dubey News Source- Mercom India